IC01 Mock Test Sample 10
These questions focus on advanced insurance concepts such as claims reserving, reinsurance, underwriting, and policy interpretation. Topics like IBNR reserves highlight claims that have occurred but are not yet reported. Reinsurance concepts such as quota share and their impact on profits are tested. Principles like contribution, underinsurance, and proximate cause explain claim settlement conditions. Practical calculations include net commission, premium pricing, and accident frequency. Regulatory and professional roles like actuaries, brokers, and advisory committees are also covered. Additionally, policy documentation, common law principles, and claim practices like “pay and recover” strengthen understanding of real-world insurance operations and decision-making.
1. Reserve for IBNR is created when claim has occurred __________.
A. and has been reported in current year but not paid
B. and has been reported and also paid in the current year
C. in current year but has not been reported
D. and has been reported in previous year but paid in current year
2. Too much dependency on Quota share reinsurance could lead to ________.
A. more capital for the reinsurers
B. less profits for the reinsurers
C. more profits for the insurers
D. more profits for the reinsurers
3. Identify the situation wherein underinsurance is applicable.
A. Value at risk 60 cr; X: 35 cr, Y: 30 cr
B. Value at risk 60 cr; X: 35 cr, Y: 25 cr
C. Value at risk 60 cr; X: 30 cr, Y: 30 cr
D. Value at risk 60 cr; X: 30 cr, Y: 25 cr
4. Who is an Actuary?
A. Professional estimating probabilities of future losses
B. A mathematician
C. One who predicts the future
D. One who invents formulas
5. In relation to Contribution, which statement is incorrect?
A. At least one policy should be indemnity
B. Both policies liable for loss
C. Both policies cover same interest
D. Loss caused by peril insured by both
6. In which case is the loss payable?
A. Train of insured perils broken by excluded peril
B. Train of uninsured perils broken by insured peril
C. Excluded & uninsured acting independently
D. Excluded & insured acting interdependently
7. Insurance Commission is payment ________.
A. paid to brokers
B. paid to agents
C. admin cost on direct business
D. on direct business
8. Concurrent causes (insured + uninsured), claim is ________.
A. payable to extent of insured loss
B. payable to extent of excluded loss
C. not payable
D. payable
9. Calculate Net Commission (650 + 85 – 155).
A. 580 crores
B. 720 crores
C. 830 crores
D. 290 crores
10. ______ is not relevant to assess human life value.
A. Age
B. Income
C. Marital status
D. Occupation
11. Date when annuity starts is called ________.
A. Deferred date
B. Unpaid date
C. Delayed date
D. Annuity date
12. ______ sources insurance but not appointed by insurer.
A. Agents
B. Employees
C. Surveyors
D. Brokers
13. Insurance Advisory Committee max members ______.
A. 20
B. 22
C. 25
D. 30
14. Health insurance pricing (given data) ______.
A. 2400
B. 2000
C. 3333
D. 2250
15. Pay and Recover arises in ______.
A. Credit insurance
B. Motor Third Party
C. Health insurance
D. Employee compensation
16. Which is not true for Common Law?
A. Applicable only in India
B. Collective wisdom of courts
C. Higher court binding
D. Principles from common law
17. ULIP policy document mentions ______.
A. Bonus basis
B. Contingencies covered
C. Investment plans chosen
D. Only B and C
18. Incorrect statement about policy document ______.
A. Void if lost
B. Proof of contract
C. Shows obligations
D. Terms & conditions
19. Net Earned Premium (given data) ______.
A. 3700 crores
B. 1850 crores
C. 1550 crores
D. 2150 crores
20. Frequency of road accidents ______.
A. 16%
B. 15%
C. 1.50%
D. 0.16%
